Forex trading is not a new concept at all. It’s been around for years, and you will have heard some fantastic success stories online or even from friends and family. But is it really possible to make all this money from forex trading?
When you see people online claiming they made millions in a few months, it’s easy to see why people want to get involved in the world of forex! However, it’s not a ‘get rich quick scheme,’ and most people have the wrong expectations from forex trading.
Quitting your job and trying to make a living from forex is a huge step. So if you’re looking to make this decision, the more information you have, the better!
To help you on your journey, read on to find some honest information about the forex world and whether you can make it in the industry.
Incorrect assumptions about forex
If you’re familiar with social media, you will have come across forex trading gurus who claim they can make you millions in under a year. Obviously, this is very appealing at first glance- who doesn’t want to be a millionaire!
However, 99% of the time, they will be selling your dreams. Unfortunately, most of these gurus make more money selling their trading tutorials than actual trading! So it’s best to avoid any overpriced tutorials online.
In reality, making it in forex is a very long process, and it’s similar to any small business that you could start. You wouldn’t expect to go from selling fast food in a kebab van to becoming a chain like McDonald’s in under a year.
It’s the same with trading. Most professional traders will have been trading and slowly increasing their capital for many years. Only after this long period of perfecting their trading techniques will they generate a sizable return.
So if you’re expecting to get rich very quickly, you should expect to be disappointed quite soon.
How much can you realistically make from forex trading?
Most professional traders will try and aim for a return rate of around 1-10% per month. With this information, you discover that beginners will not be making anywhere near a living from trading.
If you start with an account of £1000, if you manage to reach a rate of return of 10%, you’ll only be profiting £100. It’s not possible to live on around £100 per month.
Bear in mind this is also assuming you’re going to be consistently trading at a 10% monthly return rate as a beginner. This is very unlikely!
Professionals usually have much larger trading accounts that allow making a living from small return rates. With a trading account of £100,000, instead, you will profit £10,000 from your trading. £10,000 per month is a much more attractive salary than £100!
So can you actually make a salary from forex trading?
It is possible to make a living from forex trading because there are very successful professional traders.
However, you should expect it to be a long process. It wouldn’t be possible to jump straight into trading and make a salary unless you already have a large account. It would be more feasible to start trading on the side and build your way to a large account.
Once you’re making consistent enough returns to support yourself solely on trading, you could quit your current job and transition to a professional forex trader.